After experimenting with local files for Mac OS X 10.5 Leopard Directory Service, I read a hint on MacOSXHints name Manage users and groups using a GUI tool.

What this tip describes, basically, is that you can use Mac OS X Server Administration Tools to connect locally to the Directory Service running on Mac OS X Leopard. Just start Workgroup Manager, and authenticate to host localhost with the credentials of any user with administrative rights. Using Workgroup Manager it is possible to create and manage users and groups, but more important is that changes take effect immediately, without having to kill /usr/sbin/DirectoryService, rebooting or having to log out. Very nice!